Pentagon Can’t Explain Why This Afghan Gas Station Had A $43 Million Price Tag

Matt Vespa
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Posted: Nov 02, 2015 7:15 PM
Pentagon Can’t Explain Why This Afghan Gas Station Had A $43 Million Price Tag

The list of reasons for America to abandon any national-building endeavors in the Muslim world continue to mount, as we come to this inexplicable expenditure in Sheberghan, Afghanistan. The Office of the Special Inspector General for Afghanistan Reconstruction (SIGAR) sent a letter and accompanying report about a natural gas filling station that had a price tag of $43 million. In a letter to Defense Secretary Ashton Carter, Special Inspector General John Sopko wrote, “The main purpose of the project was to demonstrate the commercial viability of CNG for automobiles in Afghanistan as part of a broader effort to take advantage of Afghanistan’s domestic natural gas reserves and reduce the country’s reliance on energy imports.”

The project was spawned from The Task Force for Business and Stability Operations (TFBSO), which was created to help rebuild post-invasion Iraq. It was transitioned to sort out Afghanistan in 2009, according to the SIGAR report. The cost for this gas station was only supposed to cost $3 million, but somehow ballooned to the $43 million–and no one at the Department of Defense can account for the expenditures:

The contract awarded to Central Asian Engineering to construct the station was for just under $3 million. Yet, according to an economic impact assessment performed at the request of TFBSO:

The Task Force spent $42,718,739 between 2011 and 2014 to fund the construction and to supervise the initial operation of the CNG station (approximately $12.3 [million] in direct costs and $30.0 [million] in overhead costs).

The $43 million total cost of the TFBSO-funded CNG filling station far exceeds the estimated cost of CNG stations elsewhere. According to a 2010 publication of the International Energy Association, “the range of investment for a public [CNG] station serving an economically feasible amount of vehicles varies from $200,000 to $500,000. Costs in non-OECD [Organization for Economic Co-operation and Development] countries are likely to be in the lower end of this range.” Consistent with that finding, a 2005 CNG station feasibility study conducted by Pakistan’s Small and Medium Enterprise Development Authority concluded that the total cost of building a CNG station in Pakistan would be approximately $306,000 at current exchange rates.10 In short, at $43 million, the TFBSO filling station cost 140 times as much as a CNG station in Pakistan. To date, DOD has been unable to provide documentation showing why the Sheberghan CNG station cost nearly $43 million.

In fact, the entire $800 million program cannot be thoroughly analyzed since the Department of Defense is stonewalling SIGAR’s investigation. In that same letter, Sopko noted that he found it “both shocking and incredible that DOD asserts that it no longer has any knowledge about TFBSO, an $800 million program that reported directly to the Office of the Secretary of Defense and only shut down a little over six months ago.” Sopko then said he intends to continue his inquiry. Yet, some of the principal actors to the TFBSO, which ended in March, are still employed with the Defense Department (via ProPublica):

The Pentagon’s claims are particularly surprising since Joseph Catalino, the former acting director of the task force who was with the program for two years, is still employed by the Pentagon as Senior Advisor for Special Operations and Combating Terrorism.

In June, the DOD wrote in an official response to Sopko that it “no longer possess[es] the personnel expertise to address these questions,” a point the Pentagon reiterated in October. However, in response to questions from ProPublica Friday, a Pentagon spokesman said in an email that Catalino will be made available for questions. SIGAR had previously spoken to him before the task force shut down in March.

The Pentagon has also refused to allow SIGAR to freely review all the task force documents. Normally the inspector general is simply given the documents it requests, but the Pentagon is insisting that anything related to the task force be read in a DOD-controlled room on DOD computers, and any documents SIGAR wishes to take must first be reviewed and redacted by the Pentagon.

“We have established a reading room at the task force document storage facility specifically for SIGAR use,” said Army Lt. Col. Joe Sowers, a Department of Defense spokesman, in his email.

These “appropriate security safeguards,” as Principal Deputy Under Secretary Brian McKeon called them in a letter to Sopko, “are necessary due to SIGAR’s actions that revealed Personally Identifiable Information [PII] in an unrelated incident.”

[…]

In SIGAR’s report, Sopko said he didn’t buy the Pentagon’s reasoning for not cooperating. SIGAR has refused to abide by the Pentagon’s terms because it believes the law does not allow for them.

[…]

“This is shocking in multiple ways. The cost of an unnecessary gas station in Afghanistan skyrocketed to a ridiculous height. Now, the Department of Defense is blocking access to documents and personnel that would shed light on how the money was spent,” said Sen. Chuck Grassley, R-Iowa, in a statement. “The lack of accountability and transparency is disgraceful.”

A strong national defense is a constitutional obligation, one that the vast majority of Americans support. Yet, we must be able to account for all the receipts. That pretty much goes for any government expenditure. Why this gas station cost us a staggering $43 million is interesting, though the reported stonewalling at the Pentagon is a bit disconcerting.